ADB, Nepal banks sign trade facility agreements

ADB, Nepal banks sign trade facility agreements

Kathmandu: The Asian Development Bank, or ADB on Tuesday inked agreements with eight leading banks of Nepal, including two Indian joint ventures, to help local financial institutions forge alliances with foreign counterparts to encourage international trade transactions in the landlocked country.

The two Indian joint venture banks which signed the trade financing agreements with Asian Development Bank (ADB) are Nepal SBI Bank, having investment of State Bank of India, and Everest Bank Ltd, having collaboration with Punjab National Bank.

The other banks are Bank of Kathmandu, Nabil Bank, Himalayan Bank, Nepal Industrial and Commercial Bank, Nepal Investment Bank and Kumari Bank.

ADB has already signed such agreements in other South Asian countries including Sri Lanka and Bangladesh. However, no such agreement has been signed with Indian banks so far, ADB’s head of TFFP Stev Beck said.

Boosting trade is critical to help Nepal overcome the current global crisis that has hurt exports and may slow the growth in remittances this year and the coming one, ADB’s country director Barry Hitchcock said, adding increase trade should lead to job creation and reduced poverty in the future.

The agreements are part of ADB’s Trade Finance Facilitation Programme (TFFP). The programme which expanded to $1 billion on March end provides guarantees and loans of up to three years to support trade transactions in its developing member countries.